PAL, MasterCard launch promo

(The Philippine Star) Updated August 30, 2010 12:00 AM

MANILA, Philippines - Philippine Airlines (PAL) and MasterCard launched recently joint promotions that give MasterCard cardholders chances to win free Mabuhay Miles or rountrip plane ticket to any of PAL’s local, regional and international destinations.

As much as 180,000 Mabuhay Miles will be raffled off in the Soaring Higher promotion. To qualify, cardholders must purchase a PAL domestic, regional or international electronic ticket (e-ticket) through PAL ticket offices in the Philippines or through the PAL Internet Booking Engine using any Philippine-issued MasterCard from now until Oct. 31 and travel from now and Dec. 15.

The raffle prize will depend on the class of service of the purchased and flown e-tickets, that is, domestic tickets entitle the cardholder to only win the prize for domestic flights. The winning e-ticket number shall be drawn electronically on Feb. 15, 2011. Prizes may be claimed upon surrender of the winning ticket’s boarding pass.

The second promo dubbed Barkada Flights, gives cardholders a chance to win one free roundtrip ticket with the same route and class of service for free. Those traveling to domestic destinations can buy their tickets from now until Oct. 31 and fly between now and Nov. 30.

For more details, visit www.philippineairlines.com, www.mabuhaymiles.com or call PAL reservations in Manila at (02) 885-8888, in Cebu at (032) 340-0191 or in Davao at (082) 221-5513 or your travel agent.

PAL and MasterCard launch joint promotions

August 29, 2010, 2:08pm

Philippine Airlines (PAL) and MasterCard recently launched joint promotions that give MasterCard cardholders chances to win free Mabuhay Miles or roundtrip plane tickets to any of PAL’s local, regional and international destinations.

As much as 180,000 Mabuhay Miles will be raffled off in the Soaring Higher promotion. To qualify, cardholders must purchase a PAL domestic, regional or international electronic ticket (e-ticket) through PAL ticket offices in the Philippines or through the PAL Internet Booking Engine using any Philippine-issued MasterCard from now until October 31 and travel from now and December 15.
Mabuhay Class tickets (Premium and Classic) bought at ticket offices earn five and four raffle entries, respectively; while Fiesta Class tickets (Plus, Saver and Deal) earn three, two and one raffle entries, respectively. Entries are doubled for online ticket purchases.

Ten cardholders who buy e-tickets and fly on domestic flights will stand a chance to win 18,000 miles each. Additionally, four cardholders who buy e-tickets and fly on regional flights will stand a chance to win 80,000 miles each, while another four cardholders who will buy e-tickets and flew on international flights will stand the chance to win 180,000 miles each.

The raffle prize will depend on the Class of Service of the purchased and flown e-tickets, that is, domestic tickets entitle the cardholder to only win the prize for domestic flights. The winning e-ticket number shall be drawn electronically on February 15, 2011. Prizes may be claimed upon surrender of the winning ticket’s boarding pass.

The second promo dubbed Barkada Flights gives cardholders a chance to win one free roundtrip ticket with the same route and class of service for free. They simply have to purchase a minimum of two qualified PAL roundtrip Mabuhay Class or three qualified PAL roundtrip Fiesta Class tickets using their MasterCard card. Those traveling to domestic destinations can buy their tickets from now until October 31 and fly between now and November 30. Regional and international travelers have the whole month of August this year to purchase their tickets and must use their ticket anytime from September 16 to November 30. The promotion, however, is not applicable for travel between October 22 to November 7.

For more details, visit www.philippineairlines.com, www.mabuhaymiles.com or call PAL Reservations in Manila at (02) 885-8888, in Cebu at (032) 340-0191 or in Davao at (082) 221-5513 or your travel agent.

PAL reviving plan to boost capital amid labor problems

Friday, 27 August 2010 00:00
BY DARWIN G AMOJELAR SENIOR REPORTER
THE MANILA TIMES

PHILIPPINE Airlines (PAL) is laying the ground for the entry of a strategic partner after its stockholders reduced the price of its shares while raising the company’s authorized capital.
In a briefing, Jaime Bautista, PAL president, said on Thursday that the airline’s stockholders approved a plan to cut the par value of its shares from P0.80 to P0.20 apiece.

He said owners also increased PAL’s authorized capital stock from P16 billion to P20 billion, divided into 100 billion shares.

“There was an approval to implement the quasi-reorganization last year, but we were not able to implement it ... because we are not successful in attracting new investors. To implement it we need investors,” Bautista said.

“We hope we will implement [the reorganization] this year. It will help support our program, improve liquidity and improve [the] working capital position of the company,” he said.

Bautista had said that PAL is talking to several fund managers and Asian airlines for possible investments in the flag-carrier.

He said PAL’s negotiations with possible investors were put on hold because “the appetite has decreased due to the labor problems that we are experiencing right now.”

The 69-year-old airline is beset by labor problems and a travel ban by Hong Kong at a time when the international airline industry expects growth to resume.

In 1998, Hong Kong-based Cathay Pacific Airways Ltd. had contemplated on investing in PAL but
the plan failed to materialize because of “major differences.”

The Philippine carrier sought rehabilitation in 1998 after racking up $2.12 billion in debts.

PAL brought down its liabilities to about $1 billion since entering corporate receivership, and emerged from rehabilitation after recording a profit in 2007.

But the airline’s finances collapsed in the succeeding three years, with $350 million, or at least P15 billion, in losses during its last two fiscal years.

Its equity also dropped precipitously to a little over $1.1 million as of February this year.

Because of this, the company decided to let go of at least 3,000 employees with the spin-off of its three non-core businesses.

The affected workers belong to the in-flight catering services, airport services (including ground handling, cargo terminal/cargo handling, and ramp handling) and call center reservations.

With this, the PAL Employees Association and the Flight Attendants and Stewards Association of the Philippines (FASAP) have threatened to go on strike.

Bautista said the airline’s labor problems and the recent tragic hostage incident in Manila affected PAL’s forward booking.

He said 558 passengers cancelled flights to the Philippines for estimated revenue loss of $167,000.

PAL turned a profit of $31.6 million (P1.45 billion) in the April to June period, or lower than last year.

Revenues went up by 30 percent to $426.7 million from last year’s $327.7 million.

PAL to embark on marketing drive, sets flights to India

By FIL C. SIONIL
August 27, 2010, 10:46pm
Manila Bulletin

Philippine Airlines (PAL) is set to embark on a marketing campaign designed to attract more passengers with an end in view of further improving its bottomline.

In an interview, PAL President and Chief Operating Officer Jaime J. Bautista said the flag carrier will be conducting “more promotional programs that would give incentives to its riders” admitting that the Monday Quirino Grandstand hostage carnage may likely dent its revenue performance.

“It will surely affect our route. But hopefully, we will recover and that is the reason why we need to have more promotional programs by giving incentives. It will be a total package, not only affordable rates but including accommodation,” disclosed Bautista.

He believed, however, that the marketing program should be undertaken “closely with government authorities.”

Bautista also disclosed that by March of the coming year, PAL will be mounting direct flights to New Delhi at three times a week. The expansion of its regional routes, particularly in India is to cash-in on its improving economic conditions plus the fact that there are many “Indian nationals here in the Philippines,” Bautista said.

Also to be introduced are new flights to Riyadh, Saudi Arabia.

According to Bautista, the Hong Kong-People’s Republic of China market accounts for “almost 10 percent” of PAL’s total revenues. Hong Kong alone pours in 3.5 percent with mainland China accounting for around six percent.

PAL reported more than 500 tourists from Hong Hong and mainland China have cancelled their bookings with the airline in the wake of Monday’s tragic hostage incident where eight Hong Kong nationals were killed and several others injured.

Meanwhile, PAL is waiving the rebooking penalty on PAL tickets issued in Hong Kong for those intending to fly back ahead of schedule, as a result of the travel advisory issued by Hong Kong authorities. “PAL is beginning to feel the initial impact of a Hong Kong government advisory warning its residents to refrain from all travel to the Philippines,” said. Bautista.

As of Wednesday, Bautista said PAL’s Hong Kong station reported at least 558 Manila-bound bookings were cancelled. The bookings consisted of tourists from Hong Kong, Beijing, Xiamen and other points in China.

In the Philippines, Bautista said two Hong Kong and Macau bound Filipino tourists opted to change their destination in view of the current situation.

Despite the negative travel advisory, PAL continues to mount five daily flights to and from the former Crown Colony.

“We’re closely monitoring the situation and will decide soon whether we will maintain or reduce flights. We share the grief and understand the Hongkong people’s wrath. We are optimistic that fears of travelling to the Philippines will be temporary,” Bautista said.

He said PAL has yet to determine the financial impact of the booking cancellations at this early stage. However, he admitted that the negative travel advisories to the Philippines are not helping the flag carrier..

To date, PAL has registered about 500 ticket cancellations.

PAL said visiting Hong Kong nationals who are heeding the travel advisory will likewise not be penalized with any pertinent fees or charges when they present their tickets for rebooking or taking any earlier flight back to the former Crown Colony.

608 cancellations so far, say airlines

August 27, 2010
Manila Standard Today

PHILIPPINE Airlines said Thursday at least 558 travelers to the country had canceled flights from Hong Kong, Beijing, Xiamen and other points in China as of Wednesday following the death of eight Hong Kong tourists in Manila in a hostage-taking incident Monday.

The company would now “evaluate the possibility of reducing flights” to those destinations as a result, president Jaime Bautista said.

Immigration officials at the international airport in Manila said very few Hong Kong residents had been arriving since Monday’s incident, when a dismissed policeman opened fire on the Hong Kong tourists he had taken hostage on a tourist bus, and was himself killed by police in a botched rescue attempt. The Hong Kong government banned travel to the Philippines by its residents as a result.
A tour coordinator at the same airport said several groups of Chinese tourists had canceled their flights to Manila, Kalibo and Cebu.

“In the last two days, 90 groups or 558 passengers canceled their planned trips to Manila and Kalibo from Hong Kong and mainland China,” Bautista told reporters.

He said PAL had yet to experience the real impact of a Hong Kong government advisory warning its residents to stop all travel to the Philippines. The worst-case scenario would happen if the carrier was forced to reduce its flights between the Philippines and points in China.
“But at this point it is not yet necessary,” Bautista said.

“Hong Kong and China are very important routes for PAL.”
Philippine Airlines operates 10 daily flights to and from Hong Kong and 46 weekly flights to and from Xianmen, Shanghai, Beijing and Macau. It says it carries 40 percent of the annual tourist arrivals from Hong Kong, which totaled 123,000 last year.

“As of now, our load factors in Hong Kong and China are still okay, both at the high 70s,” Bautista said.

Cebu Pacific said there had been around 50 Hong Kong-Manila flight cancellations as of Thursday, or 2 percent of the total number of passengers for the airline’s Hong Kong routes.
“We are hoping it will not get worse,” vice president for marketing Candice Iyog said.
“As of now, we don’t see any need to reduce or cancel flights to Hong Kong.”
Meanwhile, Hongkong and Shanghai Banking Corp. said Thursday it was business as usual for its executives traveling between Manila and Hong Kong despite Monday’s incident.
“We are continuing our business-as-usual policy,” said Tony Cripps, chief executive of HSBC Philippines.

“But obviously, we cannot comment on what the [travel advisory that the Hong Kong] government issued. Jeremiah F. de Guzman, Eric Apolonio, Roderick T. dela Cruz

Air21 President Lina joins PAL board

By FIL C. SIONIL
August 27, 2010, 12:59am
Manila Bulletin

Air21 president Alberto Lina has joined Philippine Airlines (PAL) 15 man board as an independent director.

PAL made this announcement shortly after its annual stockholders meeting Thursday, wherein Lucio Tan and Jaime Bautista were re-elected chairman and re-apppointed president and chief operating officer, respectively.

This as the flag carrier waived the rebooking penalty on tickets issued in Hong Kong for those intending to fly back ahead of schedule.

This decision was made as a result of the travel advisory issued by Hongkong authorities arising from the Monday carnage.

However, PAL stressed that such tickets "must have been issued in Hongkong."
Meanwhile, aside from Lina the other members of the PAL board include Harry C. Tan, Antonio L. Alindongan, Enrique Cheng, Joseph T. Chua, Gloriap Tan-Climaco, Estelito P. Mendoza, Cesar N. Santos, Henry So Uy, Washington Sycip, Lucio Tan, Jr., Michael Tan, and Charles C. Chante.
Bautista cited Lina’s “experience in air travel and logistics solutions” as among the considerations in his appointment as independent director of the flag carrier.

On its operations, Bautista said that amidst the prevailing situation PAL is steadfast on its objective of improving its bottomline. “While the aviation industry is showing signs of slow recovery, PAL remains focused on continuing efforts to generate more revenues and control costs.”

Palal’s first quarter performance, covering April to June, 2010 showed an 11 percent slide in comprehensive income to $31.6 million from $35.5 million in the same period the year past. The management hinted that the performance was better than expected by the industry largely due to the “usual strong demand during summer vacation.”

“PAL must swallow the bitter pills and handle its labor issues with utmost care to survive amidst difficult and cut-throat operating environment,” he said.

Cancelled bookings from Hong Kong increase

By Mary Ann Reyes (The Philippine Star) Updated August 27, 2010 12:00 AM

MANILA, Philippines - Philippine Airlines (PAL) yesterday revealed that more than 500 tourists from Hong Kong and China have cancelled their bookings with the country’s flag carrier.

PAL president Jaime Bautista said the country has probably not yet seen the worst of repercussions from Monday’s hostage-taking incident that left eight Hong Kong tourists dead.

“PAL is beginning to feel the initial impact of a Hong Kong government advisory warning its residents to refrain from all travel to the Philippines. As of Wednesday, our Hong Kong station reported that at least 558 Manila-bound bookings were cancelled. The bookings consisted of tourists from Hong Kong, Beijing, Xiamen, and other points in China,” Bautista said, adding that two Hong Kong and Macau-bound Filipino tourists also opted to change their destination in view of the current situation.
He revealed that 90 groups cancelled from Hong Kong and Manila to Kalibo. The cancellations cover over a one-month period.

Hong Kong accounts for around six percent of PAL’s revenues while the United States is still the single largest source at 25 percent.

PAL carried about 155,000 passengers from Hong Kong and around 200,000 from China last year.
Only a handful of Hong Kong nationals were spotted at the Ninoy Aquino International Airport (NAIA) terminals yesterday, a stark contrast to the almost 70 percent arrival recorded prior to the bloody incident.

Hong Kong issued a top-level “black” travel alert to the Philippines, urging its nationals to avoid traveling to the country.

Bautista said it was too early to say whether the cancellations would impact on the airline’s bottom line but company officials were closely monitoring the situation in Hong Kong, where angry residents are still mourning those who perished in the carnage.

Despite the negative travel advisory, Bautista said PAL would, for the time being, continue to run daily flights to and from Hong Kong, where as many as 200,000 Filipinos live, many of them working as maids.
“We’re closely monitoring the situation and will decide soon whether we will maintain or reduce flights,” he said. “We share the grief and understand the Hong Kong people’s wrath. We are optimistic that fears of traveling to the Philippines will be temporary,” he added.
Bautista said they have yet to determine the financial impact of the booking cancellations at this early stage although he estimates the losses to be around $150,000 for PAL.

He, however, admitted that the negative travel advisories to the Philippines are not helping the flag carrier, which is currently struggling financially and grappling with restive workers.

“We understand that Philippine officials in Hong Kong met with the latter’s legislative and travel councils and assured them that the Philippines is still a safe and viable tourist destination.
We are looking forward that it will soon lead to the lifting of the travel restrictions,” he said.
Bautista said that PAL, as the national flag carrier, will continue with its sworn mission to promote the Philippines as a tourist addition, even as he added that the company will try to help in its small way to improve the capability of Filipino law enforcers.

The Philippine Tourism Authority, on the other hand, expressed concern that Monday’s events would lead to a drop in tourists coming to the country, but had no specific data about any cancellation by tour groups.

Tourism industry sees glimmer of hope

However, despite the negative travel advisory, tourists from Hong Kong and other countries are still set to visit the country soon, according to Ikebana International.
Ikebana International yesterday reported that about 300 tourists from Hong Kong are coming to the Philippines to attend the 11th Asian Regional Conference in Manila.

Evangeline Cheng, Ikebana International-Manila chapter president, said foreign delegates, including those from Hong Kong, have not signified plans to cancel their scheduled visit to Manila in September.
“We also have confirmations of attendance by delegates and guests from Japan, India, Taiwan, Singapore, Sri Lanka, Thailand, Malaysia, Australia, the United States, Germany and Italy,” Cheng said.

Cheng expressed hope that the conference would “somehow help create better understanding,” particularly between the Chinese residents of the former British colony and the Filipino people.
President Aquino is expected to grace the opening of conference, the country’s first major tourism event since his assumption to office.

Tourism Secretary Alberto Lim as well as tourism industry officials previously said that the Luneta carnage would adversely affect the country’s tourism, but it is still expected to recover eventually.
Set back temporary

Hong Kong businessman Victor Chan, owner of Home Depot, said that “although the situation now has worsened” after Monday’s tragic hostage incident, he is confident that “it is only temporary.”
A resident of Manila for over 35 years, Chan said he has never had any problem with security or doing business in the country, and pointed out that such unfortunate incidents happen all over the world, “even in Hong Kong and China.”

He said that an open and transparent investigation into the incident, with “no more cover up, no matter what,” would go a long way in restoring the confidence not only of the people of Hong Kong but all visitors and businessmen, in the country.

Monitoring yesterday’s Senate hearing, Chan noted that police officers sometimes avoided answering questions directly.

“They should be open, and admit if they are wrong – they did not do it intentionally, but they have to admit when they are wrong.” - Rudy Santos, Mayen Jaymalin

RP airlines feeling brunt of hostage crisis

(philstar.com) Updated August 26, 2010 11:30 PM

MANILA, Philippines (Xinhua) -- The Philippines' airline industry is already starting to feel the effects of Monday's hostage crisis as the tourists who were planning to visit the country had canceled their flights.

Two of the country's largest airlines - flag carrier Philippine Airlines (PAL) of the Lucio Tan group of companies and Gokongwei-led Cebu Pacific- today said that the travelers are already canceling their flights and hotel room bookings.

More than 500 people from Hong Kong and other parts of China that have booked to travel to Manila in the next 30 days have canceled their flights, PAL said.

Likewise, Cebu Pacific said that rebooking and cancellation requests from about 2 percent of the company's passengers to Hong Kong have already been reported.

The tourists have canceled their trips over security concerns in the Philippines after the recent death of eight Hong Kong residents who were killed after a botched hostage rescue operation on Monday.
"PAL is beginning to feel the initial impact of a Hong Kong government advisory warning its residents to refrain from all travel to the Philippines," PAL president Jaime J. Bautista told reporters today.
"Hong Kong is a very important route for PAL," Bautista said, but noted that only those coming from China have canceled their trips to the Philippines.

PAL flies to Hong Kong five times a day and corners about 6 percent of the company's revenues.
Hong Kong on Tuesday issued a warning against traveling in the Philippines at the wake of the hostage crisis.

The Philippine government had already anticipated a backlash on the country's tourism industry following the hostage crisis. Philippine President Benigno Aquino III had tasked the Department of Tourism to "re-engender the confidence of tourists" to the country.

International air travel picking up

Thursday, 26 August 2010 00:00
THE MANILA TIMES

THE International Air Transport Association (IATA) said the industry has taken off with international passenger traffic picking up stronger than expected. “The recovery in demand has been faster than anticipated. But, as we look towards the end of the year, the pace of the recovery will likely slow,” Giovanni Bisignani, IATA director general and chief executive said in a statement.

IATA said international passenger demand in July rose 9.2 percent year-on-year, while international freight traffic showed a 22.7 percent improvement.

The July global passenger traffic was 3 percent higher than the pre-crisis level of early 2008.

IATA said Asia-Pacific carriers outperformed the industry average with a 10.9-percent growth in July. This is consistent with the region’s 10.6-percent year-to-date growth.

“Leading the industry recovery, the region’s carriers are expected to report a profit of $2.2 billion.

This will be the largest gain in dollar terms in 2010 compared to 2009,” IATA said.

In the Philippines, the flag carrier reported a net income of $31.6 million in the April to June period on revenues of $426.7 million.

Cebu Pacific recorded a net income of P3.09 million in the January to June period, and revenues of P14.91 billion.

The country’s Civil Aeronautics Board (CAB) earlier projected that the international air travel market is likely to grow 10 percent this year.

Data from the regulator showed that international passenger volume climbed 11.6 percent to 3.44 million in the first quarter, from 3.08 million the same period last year.

Of the total, 1.64 million were inbound passengers and 1.8 million, outbound passengers.

“Improving demand is an important component of the recovery. But it must translate to the bottom line. The anticipated 2010 profit of $2.5 billion is only a 0.5 percent return on revenues.

Hence, the financial situation of the industry remains fragile,” Bisignani said.

He said costs remain a critical element for the recovery of the industry.

“This year has been marked by strikes and threats of strikes at airlines, and with airports and air navigation service providers,” the IATA official said.

In the Philippines, the Flight Attendants and Stewards Association of the Philippines (FASAP) and the PAL Employees Association (PALEA) plan to hold a strike to force the flag-carrier’s management to give in to their demands of higher pay and the removal of a new policy on compulsory retirement based on age.

In a statement, FASAP denied PAL management’s claim that the flight crew’s low salaries reflected pay for idle time.

“They constantly work under-manned, they are over-worked and underpaid. PAL even reduced the number of flight attendants per aircraft to further add to the already heavy work-load of the crew,” Roberto Anduiza, FASAP president, said.

He said PAL flight attendants are one of the most productive in the industry, as many flight attendants fly the maximum flying hours allowed by the Civil Aviation Authority of the Philippines.

Anduiza said FASAP is now meeting with its legal counsels to prepare the requirements of notice of strike.

DARWIN G. AMOJELAR

Union accuses PAL of ‘beerhouse mentality’

By Philip Tubeza
Philippine Daily Inquirer
First Posted 04:05:00 08/26/2010

MANILA, Philippines—The union of flight attendants and stewards of Philippine Airlines Wednesday accused the national flag carrier’s management of having a “beerhouse mentality” in seeking to retire flight attendants when they turn 40 or 45 years old.

Flight Attendants and Stewards Association of the Philippines (FASAP) president Bob Anduiza said PAL wanted to retire its attendants earlier because it wanted “younger and pretty flight attendants.”
“What PAL is not saying is they want younger and pretty flight attendants because of the outmoded stereotyping of treating them as sex objects. It is plain sexism and age discrimination,” Anduiza said in a statement.

“It’s the ‘beerhouse’ mentality of lusting for young and pretty girls as cocktail waitresses,” he added.
But PAL management accused the union of using “gutter language.”

“The union leaders accuse PAL of ‘beerhouse mentality’ and yet, their own statement reveals their true state of mind and exposes their low regard for their colleagues. This is a deplorable ‘below the belt’ tactic that only serves to inflame emotions and drive a wedge between management and its female workers,” PAL said in a statement.

Anduiza said other PAL employees, including PAL pilots, whether male or female were allowed to work until 65 years old “as long as they are healthy enough to work.”

“Then, why does PAL insist on retiring its flight attendants at 40 or 45 years old?” he said.
Anduiza said PAL president Jaime Bautista’s contention that its retirement policy was approved by the union in its previous collective bargaining agreements (CBAs) was a “bankrupt argument.”
“Collective bargaining agreements, as any decent company knows, expire every five years, with economic renegotiations every three years. Thus, all issues are open and subject to negotiations,” Anduiza said.

He said that since the year 2000, FASAP had been proposing to raise the retirement age of its members but PAL would always insist on the 40, 45, and 55 years old retirement ages.
“PAL would employ delaying tactics, which causes the CBA negotiations to drag on until the union becomes desperate and settles for its much needed pay increases. PAL management would then promise the union to take up the retirement issues, in the next round of CBA negotiations,” Anduiza said.

In its statement, PAL said that both parties are mandated to strictly follow the CBA’s provisions.
“It is not as if PAL is forcing its cabin attendants to retire early. These provisions were reached in previous CBAs,” PAL said.

Investors lose interest in PAL

Thursday, 26 August 2010 12:06 Lenie Lectura / Reporter
Business Mirror

FLAG carrier Philippine Airlines (PAL) said on Thursday talks with prospective investors for the planned bailout of the carrier from financial woes had been set aside and that over 500 passengers have already canceled their bookings.

In a briefing, PAL president Jaime Bautista said these were brought about by Monday’s hostage crisis and the still-unresolved labor problems with pilots and ground cabin crew.

“We have not talked to [investors] for quite some time now. They have kind of lost their appetite with what’s going on right now. They told us that we should fix our internal problems first before we resume talks,” said Bautista.

PAL is on the lookout for investors for over a year now who can infuse fresh capital into the beleaguered airline. Bautista said without new investors the airline cannot implement the quasi-judicial reorganization plan that involves selling several non-core assets.

The plan is for the airline to increase the authorized capital stock from P16 billion to P20 billion. Bautista said the reorganization entails the reduction in the par value of the shares of stock from 80 centavos to 20 centavos and increasing the number of shares from 16 billion to 100 billion shares.

“It was already approved in the last stockholders’ meeting but we were not successful in attracting investors.?In order for us to implement our approved quasi-judicial reorganization plan we need investors. We hope to implement it this year,” said Bautista.

It has been months since PAL was?actively involved in discussions with an airline based in Asia, silent investors and investment banks, said Bautista. He did not disclose their identities but said some are passive investors.

The talks were centered on how investors can help PAL’s financial situation which continues to deteriorate. The company sustained over $350 million (or more than P15 billion) in losses during the last two fiscal years. Its equity has also dropped to a little over $1.1 million as of February 2010.

Moreover, the airline is now faced with labor issues. Some 27 pilots have resigned to date and some 6,000 flight attendants have threatened?to stage?a strike.

Bautista said the shortage of pilots is now being addressed. “We are training 40 pilots. Four will graduate next month and another four in October. We will upgrade them to captains and first officers,” said the PAL president.

In the wake of Monday’s tragic hostage-taking incident, PAL said about were 558 tourists from Hong Kong and mainland China have canceled their bookings with the airline. This translates to around $167,400 in revenue losses for PAL.

“PAL is beginning to feel the initial impact of a Hong Kong government advisory warning its residents to refrain from all travel to the Philippines. As of Wednesday, our Hong Kong station reported at least 558 Manila-bound bookings were canceled. The bookings consisted of tourists from Hong Kong, Beijing, Xiamen and other points in China,” said Bautista.?

In the Philippines, Bautista said two Hong Kong and Macau-bound Filipino tourists opted to change their destinations in view of the current situation.

Despite the negative travel advisory, PAL continues to mount five daily flights to and from the former Crown Colony. “We’re closely monitoring the situation and will decide soon whether we will maintain or reduce flights. We share the grief and understand the Hong Kong people’s wrath. We are optimistic that fears of traveling to the Philippines will be temporary,” Bautista said.

He said PAL has yet to determine the financial impact of the booking cancellations at this early stage. However, he admitted that the negative travel advisories to the Philippines are not helping the flag carrier which is currently struggling financially and grappling with restive workers.

“We understand that Philippine officials in Hong Kong met with the latter’s legislative and travel councils and assured them that the Philippines is still a safe and viable tourist destination. We are looking forward that it will soon lead to the lifting of the travel restrictions,” he added. ?

Hong Kong contributes roughly 6 percent of PAL’s total revenue. China’s share is 3.3 percent and 0.04 percent for Macau. The US remains PAL’s single-biggest revenue maker at 25 percent. Domestic routes contribute 30 percent of the airline’s total revenue.

Bautista said the load factor for Hong Kong and China still remains in the high 70 percent.

Cebu Pacific said separately that less than 50 passengers have canceled their Manila-Hong Kong bookings. “We hope it won’t get worse. We don’t see any need to reduce or cancel our flights,” said Candice Iyog, vice president for marketing and distribution.

To entice the public, PAL said it would continue to offer promotional fares for its Hong Kong and China flights, market more seats and waive the rebooking penalty on PAL tickets issued in Hong Kong for those intending to fly back ahead of schedule.

Visiting Hong Kong nationals who are heeding the travel advisory will not be penalized with any pertinent fees or charges when they present their tickets for rebooking or taking an earlier flight back to Hong Kong. The tickets must have been issued in Hong Kong.

Union OKd employment terms twice in past–PAL

By Daxim Lucas
Philippine Daily Inquirer
First Posted 06:07:00 08/25/2010

MANILA, Philippines—Philippine Airlines Tuesday disputed claims made by its flight attendants’ union that the flag carrier had unilaterally imposed unfair labor practices, saying current employment terms were approved by the employees’ union itself.

In fact, PAL president and chief operating officer Jaime J. Bautista said the Flight Attendants’ and Stewards’ Association of the Philippines (FASAP) approved two such agreements that reduced the retirement age of female flight attendants to 40 in 2006.

“The old CBA (collective bargaining agreement) provides that female flight attendants hired before Nov. 22, 1996 shall be retired at the age of 55, while their male counterparts shall be retired at age 60,” Bautista said. “This was changed during the next round to 45 years of age regardless of gender for those hired between 1996 and 2000.”

CBA signatory

“The last CBA, which expired in 2006, further lowered the age of retirement to 40, of which the union was again a signatory,” he pointed out.

FASAP had earlier complained that the airline’s labor practices unfairly discriminated against its female flight attendants by forcing them into retirement even while they were still able to fulfill their responsibilities.

The airline countered that the reduction in the retirement age was meant to ensure that only the fittest flight attendants serve as air crew—an important consideration in the event of aircraft emergencies.
FASAP also raised the issue of PAL’s allegedly “discriminatory” and “unlawful” maternity policies, where pay is withheld from pregnant flight attendants.

To this, Bautista replied that the forced leave of absence of pregnant flight attendants “is also in the same CBA the union and management approved.”

“They are receiving pay and benefits in accordance with the law and the CBA,” he said. “In addition, management pays for their hospitalization.”

Perks

The PAL chief pointed out that the airline’s policies were even more generous than that of its regional peers where flight attendants are forced to go on unpaid leave immediately once pregnancies are detected.

“In PAL’s case, we only ask them to go on leave after the first trimester,” he said. “This is also for the [mother and the] baby, so as not to endanger their health by exposing them to thin air environments [during flight].”

Finally, Bautista disputed the union’s claim that its members received salaries below the minimum wage level as prescribed by law.

“The basic salary represents the compensation they are receiving for being idle,” he said, explaining that the rates were again discussed with and approved by the union in past years.

“In short, once a FASAP member starts performing in-flight duties, he or she receives additional compensation in the form of productivity allowance at the rate of P320 per hour for domestic cabin attendants, P434.50 per hour for international cabin attendants and P560 per hour for pursers. In addition, they receive per diem, transportation, monthly rice allocation,” he added.

PAL to focus on revenues, solving labor issues

By EDU LOPEZ
August 24, 2010, 4:03pm
Manila Bulletin

While the aviation industry is showing signs of slow recovery, the Philippine Airlines (PAL) remains focused on continuing efforts to generate more revenues and control costs.

PAL President COO Jaime Bautista said PAL must “swallow bitter pills” and handle its labor issues with “utmost care” to survive amidst the difficult and cut-throat operating environment.
The flag carrier posted an 11 percent decline in income to $31.6 million for its peak months April to June 2010 compared to the same period last year.

Despite encouraging numbers on account of the peak travel season, Bautista said PAL is bracing for lower passenger volumes during the airline’s “lean season” usually between August to November.
PAL reported revenues of US$426.7 million for the first quarter of its fiscal year 2010-11, an improvement of $99 million or 30% over the same period total of US$327.7 million in 2009.
During the first three months of its current fiscal year, the airline benefited from improvements in passenger traffic as well as cargo, reflecting signs of economic recovery worldwide. Higher yields generated per seat offering also complemented growth in passenger demand.

Total expenses amounted to US$ 391.6 million, up by US$ 106.1 million or 37% from the same quarter total of US$285.5 million the previous year.

Jet fuel, which continues to be the airline’s biggest operating expense, rose by US$55 million during the first quarter with fuel prices at an average of US$100.47 per barrel from US$70.28 per barrel in 2009.

The airline also reported a reduction in “Other Income” by USD 47.5 million to US$15.4 million for the first three months this year compared with US$62.9 million for the same period the year before.
During its last fiscal year ending March 2010, PAL reported a net comprehensive loss of US$14.4 million in spite of a US$35.5-million profit during the first quarter.

PAL prepares for possible disruption of operations

Monday, 23 August 2010 00:00
THE MANILA TIMES

THE Department of Transportation and Communications (DOTC) has laid down contingency measures against possible disruption of services of Philippine Airlines (PAL) that a strike by the flag-carrier’s ground and cabin crew could bring about. Dante Velasco, DOTC Undersecretary for Public Information, over the weekend, told reporters that the Civil Aeronautics Board (CAB) had informed the department that Southeast Asian Airlines (SEAIR) and Spirit of Manila Airlines (SOMA) have shown interest to serve the routes that PAL may stop serving because of the strike.

”SOMA signified its willingness and capability to immediately expand its operations [once PAL’s operations are disrupted],” Velasco said.

At present, SOMA only operates between Clark in Pampanga and Taipei in Taiwan.

Velasco said that SEAIR was also willing “but its capability is contingent on the actual delivery of their leased aircraft.”

SEAIR is leasing two Airbus A320s to Tiger Airways.

A labor dispute between PAL management and Flight Attendants and Stewards Association of the Philippines (Fasap) earlier bogged down after the union rejected the airline’s offer of P80 million in economic package under their collective bargaining agreement covering 2005 to 2010.

The standoff made Fasap decide to file a notice of strike this week.

Velasco said that the CAB plans to implement a “partial deregulation” of the airline industry if PAL’s services are halted.

Partial deregulation means that there is no limit to the number of flights and routes that can be flown by any domestic airline and fares are also less regulated.

Velasco said that CAB will communicate with foreign airlines concerned to assess their willingness and capability to expand their services to cover the international routes that PAL cannot operate.

Other contingency measures include identifying foreign carriers that are also serving routes served by PAL.

Also earlier, the flag-carrier said that it will deploy its administrative and other staff if its ground and cabin crew strike and passengers may also be transferred to PAL’s 134 partner airlines in case of flight disruptions.

PAL has a total of 134 interline partners—12 airlines in Southeast Asia, 11 in the US and Canada, 25 in Europe, 12 in the Middle East, three in Japan; and 10 in China.

It also has a pending labor problem with PAL Employees Association because of the airline’s plan to spin off its three non-core businesses.

The affected units are in-flight catering services, airport services (including ground handling, cargo terminal/cargo handling and ramp handling) and call-center reservations that employ 3,000.

PAL said that it was forced to implement the restructuring plan because of the global recession, high fuel prices, unabated liberalization of the commercial aviation industry and recent blacklisting of Philippine carriers by the European Union.
DARWIN G. AMOJELAR

Two domestic carriers being readied for PAL strike

by Jeremiah F. de Guzman and Christine F. Herrera
August 23, 2010
ManilaStandardToday

TWO small airlines are willing to stand in for Philippine Airlines in case a strike prevents it from serving some of its routes, an official said Sunday.

Spirit of Manila Airlines and Southeast Asian Airlines had informed the Civil Aviation Authority that they were interested in taking over some of PAL’s domestic routes in case of a disruption in flight services, Transport Undersecretary Dante Velasco said.

PAL accounted for 41 percent of domestic flights and 27 percent of international flights last year. Velasco said the government had already prepared a contingency plan in the event of a strike at the airline.

The flag carrier’s 2,600 ground crew and 1,600 flight crew have pending disputes with the carrier before the Labor Department, claiming unfair labor practices including discrimination.
“This is just part of the pro-active program being done by the government through [the Transport Department],” Velasco said.

He said the government had already identified Philippine Airlines’ domestic and international routes that were also being served by small local airlines, or where they had rights to operate. It had likewise talked to local carriers to assess their ability to serve the routes that Philippine Airlines might stop serving in case of a strike.

“They can apply for a permit to operate any unserved route especially in the domestic operations,” Velasco said.

“[Spirit of Manila Airlines] has signified its willingness and capability to immediately expand its operations, while SEAir is willing, but its capability is contingent on the actual delivery of their leased aircraft in October.”

Spirit of Manila operates chartered services between Clark and Taiwan using two MD83 aircraft with a seating capacity of 156 each.

SEAir has been serving key destinations since 1995, and those include Boracay, Basco in Batanes, Tablas in Romblon, Marinduque, El Nido, Cebu, Clark, Zamboanga, Jolo and Tawi-tawi.

Velasco said the government would also talk to Philippine Airlines’ partners that could serve some of the international routes it might fail to serve in case its cabin crew struck.

PAL had earlier said it was ready to deploy administrative and other staff to stand in for any striking cabin crew. Passengers may also be transferred to the carrier’s 134 partner airlines.

The looming strike at Philippine Airlines and the expected disruption of services have prompted President Benigno Aquino III’s allies in the House of Representatives to support an “open-skies policy.”

“This is the perfect time for the government to take a second hard look at the policy and the economic benefits that could be gained through an increase in air traffic,” Valenzuela City Rep. Rex Gatchalian said.

He has filed a bill supporting the President’s declaration to promote a “pocket” open-skies policy, which would allow foreign airlines to fly passengers within the country.

DoLE settles 4 labor disputes, helps forge 2 CBA agreements

INQUIRER.net
First Posted 10:41:00 08/22/2010

MANILA, Philippines—As the labor disputes in Hacienda Luisita, ABS-CBN, and Philippine Airline rages on, the Department of Labor and Employment (DoLE) has helped resolve four labor disputes in four regions.

In a news release, Labor Secretary Rosalinda Baldoz cited a report from the National Conciliation and Mediation Board (NCMB) which said the unions thus withdrew their notices of strike. These were Ever Provident Trading in Metro Manila, Clark Electric Distribution Corporation in Region 3 (Central Luzon), Dyna Image Corporation Philippines in Region 4-A (Cavite-Laguna-Batangas-Rizal-Quezon), and Treasure Steel Works Corporation in Region 10 (Northern Mindanao).

“The withdrawal of the notices of strike came after conciliation-mediation proceedings successfully settled the dispute between the contending parties,” said Baldoz.

In his report, NCMB Executive Director Reynaldo Ubaldo said the parties at Ever Provident Trading agreed on the grant of financial assistance to 11 affected workers amounting to P 46,000 as full payment of their financial claims.

Ubaldo said the union at Clark Electric agreed to withdraw the notice of strike it filed with NCMB and to exercise other options under the law. The union president at Dyna Image Corp. also manifested for the dismissal of their labor dispute.

On the other hand, the parties at the Treasure Steel Works labor dispute also mutually agreed on the across the board implementation of the wage increase granted by the Regional Tripartite Wages and Productivity Board in Region 10.

Ubaldo said the parties would implement the P13 wage increase mandated by Wage Order X-15 in Region 10 retroactive July 1, 2010, as well as the integration of the P12 cost of living allowance into the basic salary of the covered employees upon affectivity of said wage order.

In addition, the parties agreed to maintain the P16 allowance previously granted by the company.
Likewise, the parties agreed to implement the job evaluation/classification once Treasure Steel Works has fully operationalized its billet plant and blast furnace.

In a related news item, the NCMB had facilitated the forging of the collective bargaining agreement (CBA) at Thai Airways International Public Company Ltd. and its union, the Thai Airways International Local Employees Association. Both parties mutually agreed on an economic package amounting to P1,996,488.00 for the first three years of their CBA, an amount that would benefit 26 workers. The parties’ CBA takes effect on January 1, 2010 and will be valid up to December 31, 2014.

In addition, the parties agreed to submit to voluntary arbitration issues on the provisions on the scope of the bargaining unit and the monthly reimbursable transportation expense for sales representatives.
Another company that had successfully concluded CBA negotiations with its union is Moca Inc. (Aloha Hotel), which agreed with Golden Gate Hotel Employees Union to an estimated economic package amounting to P343,699.20 which amount will benefit 68 covered workers. The CBA takes effect from August 16, 2010 up to August 15, 2013.

PAL posted lower profit of $31.6m in first quarter

by Jeremiah F. de Guzman
August 22, 2010
ManilaStandardToday

Flag carrier Philippine Airlines reported a lower profit in the first quarter ending June 30 on higher fuel expenses.

PAL said total comprehensive income reached $31.6 million during the peak months of April to June 2010, down 11 percent from $35.5 million year-on-year.

PAL registered a net comprehensive loss of $14.4 million in fiscal year ending March this year, down from $297.8 million in 2009, despite the first-quarter profit of $35.5 million.

Revenues in the first quarter rose 30 percent to $426.7 million from $327.7 million on year.

PAL Holdings Inc., the flag carrier’s parent company, told the Stock Exchange passenger and cargo volume grew 7 percent and 113 percent, respectively, while yields generated from passenger seat offerings rose 13 percent.

“The airline benefited from improvements in passenger traffic as well as cargo, reflecting signs of economic recovery worldwide,” PAL said.

Total expenses, however, climbed 37 percent to $391.6 million from $285.5 million last year, because of the increase in fuel costs.

Fuel expenses, which represent almost 40 percent of total operating cost, increased by $55 million as the average fuel price rose from $70.28 million in 2009 to $100.47 in 2010.

PAL Holdings said lower aircraft, component and engine repair expenses and cost-cutting measures stabilized operations.

The airline also reported a reduction in “other income” by $47.5 million to $15.4 million in the first three months this year from $62.9 million on year.

PAL president and chief operating officer Jaime Bautista said the flag carrier “remains focused on continuing efforts to generate more revenues and control costs.”

He added that PAL must “swallow bitter pills” and handle its labor issues with “utmost care” to enable the airline survive amid the cut-throat competition.

The impact of the flight cancellations on operations following the resignation of 26 pilots in early August will be reflected in the second quarter ending September.

Cabin crew and ground employees threatened to stage a strike over the retirement age, demand for salary increases and the planned spin-off of three non-core units affecting around 2,600 ground workers.

PAL Holdings reported a total comprehensive income of P1.63 billion in the quarter ending June 30, from P1.69 billion on year.

Cabin crew want share of flag-carrier’s profits

Saturday, 21 August 2010 00:00
BY DARWIN G. AMOJELARSENIOR REPORTER
THE MANILA TIMES

Flight attendants and stewards of Philippine Airlines (PAL) want the management of the flag-carrier to share with them its more than a billion profits for the first quarter of its fiscal year. The Lucio Tan-owned PAL on Friday announced that it made profits amounting to $31.6 million (P1.45 billion) from April to June. This was 11-percent lower than the same period last year.

Jaime Bautista, PAL president and chief operating officer, attributed the earnings to the “usual strong demand during the summer vacation.”

The airline’s revenues went up by 30 percent to $426.7 million for the first quarter of its fiscal year 2010 to 2011 over the same period of $327.7 million.

During the first three months of its current fiscal year, PAL said that it benefited from improvements in passenger traffic as well as cargo, reflecting signs of economic recovery worldwide.

Higher yields generated per seat offering also complemented growth in passenger demand.

PAL’s total expenses amounted to $391.6 million, up by $106.1 million, or 3 percent from the same quarter total of $285.5 million the previous year.

Jet fuel, which continues to be the airline’s biggest operating expense, rose by $55 million during the first quarter with fuel prices at an average of $100.47 a barrel from $70.28 a barrel in 2009.

The airline also reported a reduction in “other income” by $47.5 million to $15.4 million for the first three months this year compared with $62.9 million for the same period the year before.

When sought for comment, Andy Ortega, the vice president of Flight Attendants and Stewards Association of the Philippines (Fasap), said that the management should increase its offer in its labor talks with the association, with PAL posting a net profit.

“PAL’s P80 million offer is not enough. They should share its profits with cabin crew,” Ortega added.

According to the Fasap vice president, PAL’s savings amounted to P235 million in the last three years for reduced number of cabin crew a flight.

Ortega said that the airline industry is recovering, including PAL, and he added that PAL management’s offer had no basis.

The labor dispute between the PAL management and Fasap earlier bogged down after the union rejected the airline’s offer of P80 million
economic package under their collective bargaining agreement covering 2005 to 2010.

The standoff made Fasap decide to file a notice of strike next week.
Bautista, however, said that despite encouraging numbers on account of the peak travel season, “PAL is bracing for lower passenger volumes during the airline’s ‘lean season’ usually between August to November.”

He added that while the aviation industry is showing signs of slow recovery, PAL remains focused on continuing its efforts to generate more revenues and control costs.

In moving forward, Bautista said, the flag-carrier must “swallow bitter pills” and handle its labor issues with “utmost care” if the airline is to survive amid a difficult and cut-throat operating environment.

PAL also has a pending labor problem with PAL Employees Association because of the airline’s plan to spin off its three non-core businesses.

The affected units are in-flight catering services, airport services (including ground handling, cargo terminal/cargo handling, and ramp handling) and call-center reservations that employ 3,000.

PAL said that it was forced to implement the restructuring plan because of the global recession, high fuel prices, unabated liberalization of the commercial aviation industry and recent blacklisting of Philippine carriers by the European Union.

During its last fiscal year ending March 2010, PAL reported a net comprehensive loss of $14.4 million in spite of a $35.5-million profit during the first quarter.

1-2-3 Jump! The benefits of group getaways

By VINCE G. LOPEZ
August 21, 2010, 3:49pm
Manila Bulletin

More friends mean more fun especially with the kind of rewards that await groups of friends booking their latest getaway. (Photo by VINCE G. LOPEZ)

There are infinite reasons why people love packing their bags to get away.

Some people travel to discover God’s marvelous creations. Some choose to spend quality time with a loved one in a faraway place. Some just want to be alone and escape from the reality that surrounds them. While some travel to flood their Facebook account with incredible photos to make other people feel bad that they are still at their office tables with a pile of files.

Deny it or not, there is an unspoken pressure to travel; and it is probably the best pressure there ever is.
The onslaught of promo fares, lean season rates, incredible travel packages, and yes, Facebook photos, are just some reasons why the fad of traveling never dies. It is no longer just a luxury, it has become a need.

But perhaps there is something more than just sceneries that make travel photos exciting. It must be the fun factor in every shot. The project-your-best-angle photos, the perpetual “barkada jump shot” and just the mere group hug pics amidst a glorious backdrop make the viewer want to go there and experience it firsthand.

There is magic in group travel and there are a lot of reasons why it is beneficial to do so. Here is a short rundown of reasons why you should convince your friends to come with you on your next trip:

1. Someone would take your picture
You did not shop for new clothes and lost a lot of weight just for it to be remembered by someone’s eyes. Pictures have to capture those hard-earned moments. You may always ask a complete stranger to click the shutter but wouldn’t it be nice if someone you are always with could document the joys of your travel? Couples usually end up with a stretch-your-arms-we-gotta-fit-into-the-screen shot, but if you are traveling with a group, you can even get great photos for your future wedding AVP.

2. Safety
It is always safer to travel with a group because harmful people would be wary of endangering you or fooling you into paying unnecessary fees. For them, there is always the threat of a scandalous traveler and being with a group heightens the possibility that one of them loves to complain. Also, if something bad happens, a lot could participate in the bayanihan rescue.  

3. Sure companions
Some like to sit in a bar or wander alone on the beach, hoping that they would bump into the man/woman of their dreams. Yes, you can still have those telenovela scenes but it may also result to hours of lonely moments. So instead of worrying who to be with on your next trip, bring them along so you can have a group of buddies to set the dance floor on fire and fool around with your That’s Entertainment moves.

4. Cost-sharing
The best thing to share in life after all, is the cost. And this is the primary reason why group travel is such a great thing. It is an undeniable reality for some travelers that trips are still quite out of the usually planned finances. Though Boracay has transformed from being an immaculate hard-to-reach paradise to becoming Manila’s beach, there is still the budget to consider when traveling.
However, if you are traveling with a group, you can share the cost in the following:

a. Room Accommodation
Consider it an out-of-town slumber party and share the room. Triple and quadruple occupancy breaks the cost among its lodgers to around half the original price.

b. Tour Vehicle
No matter how jam-packed or comfortable you are, the car/van/boat would still run on the same amount of gas and you would still pay the same driver’s fee. This is why it is best to share the cost of the total amount. For example, to hire a multi-cab to go around the island of Camiguin costs P1,500.00. If it is just the two of you, you would be paying P750.00 each. But if you belong to a group of eight excited travelers in the vehicle, you just have to pay P187.50 each.

c. Airfare
Philippine Airlines (PAL), together with Mastercard recently launched a promo dedicated for—as it acronym spells it—pals. Aside from getting your miles, booking via a Mastercard automatically earns raffle entries for a lot more miles. A buy-two-take-one promo for Mabuhay Class or buy three-take-one for Fiesta Class promo allows groups to save on airfare, giving the last guy the same seat class as the three others. The promo runs from August-October 2010 for domestic travel (travel dates: August-November 2010) and for the whole month of August for international travel (travel dates: September 16-November 30, 2010). You can check their websites www.philippineairlines.com or www.mabuhaymiles.com for details.

d. Group Meals
Solo value meals usually cover the usual dishes such as fried chicken or barbeque. But if you are ordering as a group, then you can eat together a la familia with different entrees of your choice.

5. Fun Factor
The best thing about traveling in groups is that there are a lot of fun factors involved. The videoke challenge, the repeated stories of experiences that you still get a kick out of no matter how many times these are told, and the sheer enjoyment of being with great pals are just some reasons why traveling in groups are beneficial.

Through this, traveling is not just about discovering different places but also about creating experiences which you can always smile when you reminisce. More than sharing the cost, you share priceless moments. It certainly makes the place, not just beautiful, but utterly memorable.

‘Open skies’ not yet policy, says Palace

By Norman Bordadora
Philippine Daily Inquirer
First Posted 02:37:00 08/21/2010

MANILA, Philippines—An “open skies” policy that frees up the country’s air routes to foreign carriers has yet to be adopted by the Aquino administration, a presidential spokesperson told reporters yesterday.

Secretary Ricky Carandang of the Presidential Communications and Strategic Development Office said the matter is still up for discussion and further study by the economic cluster of the Cabinet.
This developed as Philippine Airlines (PAL), taking exception to an Inquirer story yesterday, clarified that it said nothing about “warning” the government about open skies.

“In fact, PAL’s message was that it will heed the President’s call to expedite the resolution of its labor problem,” PAL president Jaime Bautista said in a press statement yesterday. He said the story was “attributing to PAL something it did not say.”

In its press statement on Thursday, PAL said it welcomed President Aquino’s decision to consider opening the country’s skies to foreign carriers as one of the government’s options should the flag carrier and its workers fail to resolve their differences.

‘Wake-up call’

Bautista was quoted by the statement as saying the President’s pronouncement is a “wake-up call” for both PAL management and its flight attendants to immediately resolve their labor dispute.
The union of flight attendants had pulled out of conciliation under the Department of Labor and threatened to go on strike over management’s plan to spin off some employees.

“More than anyone else, PAL wants to put closure to its CBA with its cabin crew. But like any negotiated CBA, it must take into consideration not only the union’s demands but also the airline’s capacity to pay and meet those demands. It’s give and take,” Bautista said.

Carandang said that while it is not yet policy, open skies “has been discussed as a possible long-term solution to the problems of aviation.”

Complex problem

“It’s a very complex problem, which involves upgrading our procedures and security standards and all of that. Open skies is just one part,” he said.

“This administration has not yet decided to implement open skies,” he added.

The secretary was reacting to a statement of PAL that the government should first address the basic issue of inadequate aviation infrastructure before freeing up the industry to foreign players.
Carandang said it was agreed in a recent meeting of the Cabinet economic cluster that departments like those on tourism and on transportation study the open skies policy carefully before coming up with a recommendation to the President.

President Aquino on Wednesday raised the possibility of open skies if PAL continued to have problems with its labor force and cause problems in air travel in the country.

“Let’s make it clear. PAL is not against open skies. We just want it to be fair, reciprocal and its implementation should be phased-in and calibrated,” PAL president and chief operating officer Bautista had said in a statement.

He said the proposal for open skies should be studied carefully.

Bautista told of problems such as Manila’s congested runways and overburdened terminals that could worsen when the country’s air industry is liberalized.

To The Point

Emil Jurado
August 20, 2010 ManilaStandardToday
It’s about time for open skies

President Benigno Aquino III, reacting to reports of misuse of public funds by officials of government-owned and -controlled corporations and other state agencies, said that an executive order was now being prepared to put a cap on salaries, allowances, representation expenses and intelligence funds of these corporations, especially those losing money.

Nobody can quarrel with that. Indeed there have been abuses. Santa Banana, there were reports that a president of a government financial institution amassed P200 million while in office. He should be made to return the money in excess of what he was due!

Actually, former President Gloria Arroyo already issued an executive order limiting GOCC officials’ salaries and other perks, especially bonuses and intelligence funds (intelligence funds for what?). This order, unfortunately, was not strictly enforced.

The ball now is in President Aquino’s court. Granting that such an order is forthcoming, who would now want to join the government? It will not be able to compete with the private sector in terms of compensation.

Unless, of course, one joins government with the intention of stealing taxpayers’ money.

* * *
In the wake of the collapse of negotiations between Philippine Airlines management and the group of flight attendants and pilots, Malacañang has threatened to adopt the long-neglected policy which would open Philippine skies to the unlimited entry of foreign airlines.

The airline has been beset with problems: it continues to lose its shirt year in and year out and Lucio Tan’s labor woes have been worsening. Under these circumstances, PAL will likely go belly up.
From his deafening silence, Tan makes us think he may finally be ready to collapse the airline. After all, he still has AirPhil, the budget airline servicing regional routes. AirPhil is making money.

I think President Aquino should go ahead and opt for Open Skies. He should not just threaten to do so. We saw the need for this when PAL canceled numerous flights—and affected business and tourism.
For many years, a single interest—the powerful Tan’s—has held Presidents hostage. The argument against open skies has always been that if PAL could not get reciprocal rights to land on other countries intending to send flight to the Philippines, no way should Philippine skies get opened to foreign airlines.

It’s a protectionist attitude which has no place in a global community. In a world without borders, business is the survival of the fittest. Sure, many foreign airlines are subsidized (as was PAL when government still controlled it). But the airline business has become more competitive than ever.
I say it’s about time President Aquino show political will and do what is best for the national interest.

* * *
The President did what had to be done by reading the Riot Act to two-star Rear Admiral Feliciano Angue. This came from the Commander-in-Chief after Angue complained before media about his re-assignment to Zamboanga, which he claimed to be a “demotion” from his former post in the National Capital Region. Indeed, Angue should have simply kept his mouth shut and followed his superiors’ order.

Since there’s a process in the military for airing grievances, Angue violated something very basic in the military—the chain-of-command. And the President had to do something because if such protests afflict the military, others who do not get what they want may also resort to the same actions.
It is true that politics sometimes gets in the way of promotions. But Angue should have been aware of this from the start. It’s a good thing President Aquino told Angue to shut up. But he must also look into the system of promotions because problems here can cause demoralization in the military.

* * *
Insiders at Customs rate the performance of Commissioner Joselito Alvarez as “so far, so good.”
Well, considering the numbers that the national government expects the agency to produce, “good” will simply not cut it. To meet and overshoot his targets, Alvarez has to come up with the measures to drastically curb smuggling, and exercise political will to flush out all the rats that infest the pier zones. These elements take away from government billions of pesos in revenues.

Fortunately for Alvarez, the golf scorecard cheating issue that had initially hounded him has been relegated at the sidelines. What still hovers above him, however, is the link to former Customs Chief Guillermo Parayno, now Finance undersecretary, and Bert Lina, who reportedly still have tremendous clout over Customs operations.

Prior to his appointment to the Bureau of Customs, Alvarez was a director of several companies owned by Lina. On the other hand, Parayno was president of yet another Lina company that is a subcontractor of a firm that deals with the BoC’s Management Information Systems and Technology Group headed by a known Parayno protege, Deputy Commissioner Alexander “Balong” Arevalo.
Observers say that Alvarez could put this issue to rest if he digs deep into the operations of the MISTG which, according to those in the know, are mired in secrets stored in computer technology. Only Arevalo knows these secrets and he supposedly chooses not to share these with anyone, not even with his former boss, Napoleon “Boy” Morales. My gulay, that was one instance of an Alexander standing his ground to a Napoleon!

This time, can Alvarez get out of Arevalo every bit of information pertaining to the agency’s import transactions? If he takes it further and bears down on Arevalo, he would in effect be finally cutting off the umbilical cord that ties him to the influential gentleman. And Santa Banana, that could be a final giant step towards genuine reform at the BoC, and one that could be termed not merely “good,” but “truly praiseworthy”!

* * *
GMA network has seemingly found its golden touch anew as it has successfully regained the momentum in the ratings game versus its closest rival ABS-CBN for the month of July.

Mega Manila continues to deliver solid numbers for GMA-7. Nielsen TV Audience Measurement’s Mega Manila data for July show GMA posting a 5.6-percentage point advantage over ABS-CBN in audience shares, 37.5 percent versus 31.9 percent. Among households, GMA-7 still leads ABS-CBN, 35.3 percent versus 32.8 percent.

GMA-7’s strong ratings performance in July is also visible in Urban Luzon, which makes up 77 percent of television households nationwide. Here, GMA-7 led ABS-CBN by 0.4 percent in people audience shares with 35.8 as against the latter’s 35.4 percent. It is important to note that GMA-7’s margin resulted from a noticeable decline in ABS-CBN’s share performance in the said area, where it led GMA-7 by 5.4 percentage points last June.

And though ABS-CBN is still ahead in national ratings, GMA-7 is undeniably catching up, July people ratings show GMA-7 trailing ABS-CBN by just 1.5 percentage points, 6.0 percent versus 7.5 percent.
At the rate things are going, GMA-7 is in a very good position to further eat up on ABS-CBN’s lead in national ratings, especially with its newly launched shows “Ilumina,” “Kaya ng Powers,” and “Love ni Mister, Love ni Misis.” Add to that the highly-anticipated third season of the top-rating reality show “Survivor Philippines.” GMA’s news programs and specials meanwhile remain as viewers’ most preferred source of information.

Note that Nielsen TV Audience Measurement used by GMA-7 is also used by at least 22 other companies including TV Channel—not ABS-CBN. On the other hand, only a handful, including ABS-CBN, is said to subscribe to Kantar Media, formerly known as TNS Philippines.

* * *
It’s no exaggeration when I say that torture seems to be a police culture. In my over half a century as a journalist, having covered all beats from the police, jails, city halls, courts and on to the Department of Justice, Finance, Bureau of Customs, Immigration, the Armed Forces, the Central Bank and every economic beat, I know whereof I speak. I have seen policemen beat up suspects, especially the hardened criminals involved in rape, drugs, murder, and syndicated crimes like carnapping and kidnapping for ransom.

The idea is to make the suspects admit their crimes without giving them the benefit of the doubt. When I saw that ABS-CBN video, I was more than shocked at how cruel some people can get to others. It’s a perfect example of man’s inhumanity to fellow man.

Torture by police in the Philippines is not uncommon. It also happens in other countries. Even members of the police forces in the US, the FBI and the CIA resort to it to get confessions and results.

We may minimize them in the Philippines by a vigilant media, but how about places where media is not as present and vigilant?

* * *
Filipinos have garnered so many awards and recognition abroad. But one recognition that has not been publicized is that of former Laguna Rep. Totoy Tingzon, regarded as the “Godfather” of Youth Basketball in the Philippines”. He helped establish the Little League organization in the early 1960s while concurrent head of the Philippine Amateur Baseball Associations and the Manila Bay Baseball League, and went on to introduce PONY International in Asia under the Philippine Tot Basketball Association.

When the 35th PONY in Asia was marked in July in Tokyo, Tingzon was supposed to have attended it as an awardee, being a co-founder of PONY Asia and a PONY Hall of Famer. Tingzon, however, could not make it because of prior commitments.

Medium Rare

Fly or fry
By JULLIE Y. DAZA
August 20, 2010, 4:45pm
Manila Bulletin

If effectively you have failed to live up to your obligations to the people, government will be forced to adopt a policy that will have to side with the riding public rather than the interest of one corporation.
– President Aquino Thank you, Mr. President, for siding with the riding public and not that “one corporation,” Philippine Airlines. On the other hand, when has government favored the national flag-carrier? And now, on top of all its labor woes – pilots turning their back on the airline after the P1 million spent to train each of them; flight attendants and ground staff poised to strike – it looks like the pressure is on the airline to jettison its owners and vice-versa.

The Tourism secretary is calling for “partial open skies.” What’s that? Like a half-pregnant woman? someone who’s half-corrupt, like a cheating golfer who would make an ideal tax collector?
The riding public will benefit directly from government’s pro-passenger stance if it would, aha and ehem, subsidize PAL like all those Middle Eastern airlines are subsidized by their governments.
Our airport is probably the only one in this part of the world where one and only one European airline, KLM, flies in because all the others just cannot compete with the subsidized fares of their Middle Eastern competitors.

Subsidizing PAL, what a great way to fly!

Open skies eyed to boost tourism

By Aurea Calica (The Philippine Star) Updated August 20, 2010 12:00 AM

MANILA, Philippines – President Aquino is seriously considering an open skies policy to reverse civil aviation policies that Malacañang officials said have been hampering tourism development.
“It’s about time that we assess (the situation) and to have more relaxed rules for the country to grow,” Presidential Communications Operations Office Secretary Herminio Coloma said yesterday.
The move will allow foreign carriers to service the routes of Philippine Airlines (PAL) if the management and personnel of the flag carrier fail to resolve their labor disputes.

Aquino cited the perennial labor problems besetting PAL. He stressed the riding public should not be held hostage by these disputes.

Mr. Aquino said he would consider the interest of the public in general as against the corporate interests of a single corporation.

Coloma reiterated the President’s call on the PAL management and its workers to consider national interest since the public would be affected by their actions.

Although an open skies policy could affect PAL and other local carriers, Coloma stressed its benefits could boost tourism and the economy.

The President had cited as an example the tourism in Bali where the number of tourists increased after the aviation policies were relaxed in Indonesia.

He stressed the present aviation policy should be reevaluated.

“The problem of our tourism industry is that there only few flights entering the country,” Mr. Aquino said.

“They are very few because (airline industry) is regulated in terms of the entry of other carriers. If we open, then entries will increase,” Coloma added.

PAL, for its part, welcomed the proposal of adopting an open skies policy.

“The President’s pronouncement is a wake-up call for both PAL management and its cabin crew union to immediately solve (its labor) impasse. We hear the President’s call that we must find solutions to avoid any inconvenience to the riding public,” PAL president Jaime Bautista said.
“Let’s make it clear: PAL is not against open skies. We just want it to be fair, reciprocal and its implementation should be phased-in and calibrated,” he said.

Bautista added the open skies should be viewed in the context of available infrastructure like the country’s congested airport runways and overburdened terminals.

He said these factors contributed to the country’s negative image abroad as a premier tourist destination.

Bautista also called to expand the capacity of other airports in the country to accommodate more flights and promote tourism in the countryside.

More support

Other groups and sectors also expressed their support for the open skies policy.

Ruperto Cruz of the Pinoy Gumising Ka Movement (PGKM) said the open skies policy could even benefit overseas Filipino workers aside from boosting local tourism.

“It’s a long-delayed justice for the hundreds of thousands of OFWs who would benefit from cheaper and direct flights from the places they work abroad.

It is also an act dismantling virtual aviation monopoly that has shackled national interest for so long,” Cruz said.

Cruz said their group had been pushing to adopt an open skies policy since 1994 proposing the Diosdado Macapagal International Airport (DMIA) as “the future site of the country’s premiere international airport.”

“It is unfortunate that air access to the Philippines is not only inadequate. It is severely limited by an antiquated regulatory policy that seeks to preserve certain advantages for a select few at the expense of those who need to fly,” he said.

The Federated Association of Manpower Exporters (FAME) and The Center for Strategic Initiatives also expressed support for more liberalized open skies policy.

They said the open skies policy would address the problems of delay in the deployment of workers because of the shortage of flights to the Middle East.

Officials of the Clark International Airport Corp. (CIAC) operating the DMIA also expressed support for a more liberal policy in the aviation industry.

CIAC executive vice president Alex Cauguiran said the adoption of open skies policy would result in increased tourist arrivals.

Affordable Air Access Alliance-OFW Sector (4A’s), an alliance of overseas Filipino workers (OFW), headed by Arnel de Guzman, also expressed their support for the plan.

De Guzman said an open skies policy “would allow millions of Filipino workers in the Middle East cheaper access to air fares being granted by various air carriers.”

“There are about 1.8 million overseas Filipino workers mostly coming from Central and Northern Luzon. The closest airport in the area is DMIA in the Clark Freeport,” De Guzman said.
The Clark Investors and Locators Association (CILA) said the present aviation policy restricted foreign airlines at DMIA to only the third and fourth international freedom rights of air carriers.
They said the restrictive air policy effectively reduced the number of potential flights and passengers to the DMIA and dampened its attractiveness as a regional economic hub.

Losers

On the other hand, a tourism industry leader urged President Aquino should support PAL in trying to solve its labor problems instead of adopting an open skies policy.

“The government should support PAL and not act like they are operating PAL. It should leave PAL to work with its airline partners and implement its contingency measures in case a strike will happen,” said Robert Lim Joseph, chairman of the Travel Cooperative of the Philippines and chairman emeritus of the National Association of Independent Travel Agencies.

Joseph said the government should not intervene in the labor row and warned other interest groups would take advantage of the situation to the detriment of PAL and the national interest.
Joseph recalled that when foreign airlines were allowed to service some PAL routes, the flag carrier temporarily ceased operations in 1998 and airline fares went up.

“This is not to mention the damage that such policy of allowing foreign airlines to take over PAL’s routes will do to our image,” Joseph said.

Joseph also warned Filipino travel and cargo agents would be displaced once foreign airlines take over PAL’s operations.

Joseph appealed to the PAL union leaders for sobriety and to work with management to resolve their differences for the sake of national interest.

PAL reportedly lost P15 billion in the last two fiscal years (2008-2009) due to the global economic crisis that drastically slowed down travel and high cost of jet fuel, among others.

Joseph pointed out that “one crisis cannot solve another crisis,” and warned that in case PAL collapses as a result of a crippling strike, 8,500 jobs will be lost and workers can no longer get whatever benefits they are entitled to like retirement and health.

“Both management and workers will lose in the event PAL will close down,” he said. – With Mary Ann Reyes, Ding Cervantes

PAL urges gov't to implement "fair" open skies policy

(philstar.com) Updated August 19, 2010 10:01 PM

MANILA, Philippines (Xinhua) -- Embattled flag carrier Philippine Airlines (PAL) cautioned against the liberalization of air rights, better known as the open skies policy, as the country's current infrastructure may not be able to handle increased air traffic, according to the PAL's statement today.

"Let's make it clear: PAL is not against open skies. We just want it to be fair, reciprocal and its implementation should be phased-in and calibrated," PAL President Jaime J. Bautista said in the statement.

Bautista is reacting to President Benigno S. Aquino III's statement Wednesday, saying that the government is studying the implementation of the open skies policy, which will allow more flights to enter the country thus raising tourism receipts. Aquino 's statement was issued at a time that PAL is being hounded by labor issues, forcing it to cancel some flights.

But Bautista said the open skies policy should be viewed in the context of "available infrastructure like the Ninoy Aquino International Airport's (NAIA) congested single runway, overburdened terminals and the country's negative image as a tourist destination."

As he welcomed calls for more relaxed access to the Philippines, he said all airlines with existing capacity rights to Clark, Cebu, Davao and other areas should be encouraged to mount more flights to these areas to decongest Manila and promote nationwide tourism.

The Philippines has already signed an open skies deal with members of the Association of Southeast Asian Nations (ASEAN), but the current deal covers major airports only. In the Philippine case, only the Manila-based NAIA is covered.

President Aquino also said that the unresolved dispute between the PAL management and the 1,600 members of the Flight Attendants and Stewards Association of the Philippines (FASAP) may hasten the country's adoption of open skies policy, especially if the interest of the riding public is at stake.

"The President's pronouncement is a wake-up call for both PAL management and its cabin crew union to immediately solve the CBA (collective bargaining agreement) impasse. We hear the President's call that we must find solutions to avoid any inconvenience to the riding public," Bautista said.

“More than anyone else, PAL wants to put closure to its 2005-2010 CBA with its cabin crew. But like any negotiated CBA, it must take into consideration not only the union's demands but the airline's capacity to pay and meet those demands. It's give and take," he said.

He added that non-economic benefits such as the retirement age and other peripheral issues can be discussed in the next round of CBA talks which PAL management and FASAP "can immediately begin."

FASAP, however, insisted that all the issues, particularly the retirement age, should be resolved immediately.

Aquino warns PAL strikers govt will allow open skies

by Vito Barcelo and Eric Apolonio
August 19, 2010
ManilaStandardToday

PRESIDENT Benigno Aquino III said Wednesday the government might open the airline market to more competition if the workers in Philippine Airlines struck and crippled the nation’s largest carrier.

“They will hasten the opening of our skies if they disrupt a very necessary service to the country,” Mr. Aquino said of the employees who have threatened to strike over pay and other grievances.

He would have to side with the riding public in the ongoing dispute at the flag carrier.

“Having either a total open-skies policy or a partial open-skies policy, which was done somewhere in the ‘90s, is already being studied,” Mr. Aquino said, adding some foreign airlines could be asked to serve PAL’s routes if a strike crippled its operations.

In 1998 the government asked Cathay Pacific to take over some of Philippine Airlines’ routes after some 600 of its pilots struck.

“If you fail to live up to your obligations, the government will be forced to adopt a policy that will side with the riding public,” Mr. Aquino said.

He urged the carrier’s management and labor groups to think of the future as they sought to end their dispute.

The airline’s flight attendants and stewards pulled out of talks Tuesday over its refusal to take up their objections to the mandatory retirement age of 40 for women. They also threatened to join the ground crew who have already filed a notice of strike with the Labor Department.

Officials of the cabin crew union, representing about 1,600 flight attendants and stewards, rejected a management call Wednesday to reconsider its offer of P80 million to close collective bargaining talks.

The union wants a 7-percent pay increase, which they value at P260 million, and an increase in the women’s retirement age to 60, the same for men.

“PAL misses the point,” said Bob Anduiza, president of the Flight Attendants and Stewards Association of the Philippines.

“The 40-year-old mandatory retirement age is unreasonable and unjustified … It is not about money; it is about age and gender discrimination.

“PAL cannot even explain to the public why it insists on retiring flight attendants at such an early age. PAL is unfairly using this issue as a leverage and a bargaining chip to get difficult work-rule changes from the flight attendants and make them work for less pay.”

Anduiza said the airline’s policy on pregnancy and maternity leave was not only discriminatory but could also be unlawful.

“PAL’s pregnancy policy for flight attendants is punitive,” he said.

“Flight attendants who get pregnant are placed on prolonged leave without pay and this period is deducted from their years of service. It is the same treatment imposed on employees who are penalized with suspension.”

The airline was also deducting the mandatory maternity leave of 60 days from a flight attendant’s years of service, Anduiza said.

Labor Secretary Rosalinda Baldoz said the law required a lengthy process before workers could strike. A majority of the union’s members must also approve the strike through a secret ballot.

“There is a 30-day cooling-off period after the filing of a notice of strike,” she said, to give the department time to mediate.

Some non-union workers who oppose the strike have appealed to the Labor Department to step into the dispute.

“We’re concerned that our anti-strike sentiments will not be heard,” said Eugene Reyes, an employee assigned to the departure check-in counter at the Ninoy Aquino International Airport.

“Our main concern is our livelihood and the future of our children. We hope Secretary Baldoz will protect our rights.”

PAL has 7,590 regular employees, including 450 pilots and 1,650 cabin crew. More than 3,000 workers are non-union members. With Joyce Pangco Pañares